Problem: You want people who do not have email to be able to create accounts on your site. You do not want to go to the no authentication option, the manual accounts only option, etc.
What do you do?
Solution (sort of): Well, you could tell these folks to use a fake email address. Anything at example.com would do: firstname.lastname@example.org, email@example.com, etc. Once or twice each day, you would then go to http://yoursite/moodle/admin/user.php and confirm the new accounts. This is not a perfect solution, but it will certainly work for you and your users.